A Goal of Airwaves Auction In Doubt

Public-Safety Groups May Not Get Network

More than 200 companies qualified to bid in the upcoming auction of public airwaves that could raise as much as $15 billion for the U.S. Treasury. But it's not clear whether any of those companies will fulfill one of the key goals of the auction -- to attract a bidder that would build a wireless network that could also be used by public-safety agencies.

Among those that had initially applied to bid but did not qualify was Frontline Wireless, a Greensboro, N.C., start-up that had hoped to build a national emergency communications network that would be shared with commercial users.

Last week, a company spokeswoman said Frontline was "closed for business." Frontline had planned to bid on a block of spectrum designated for the shared network, which required an upfront payment of $128 million.

The company's withdrawal cast doubt on the prospects for that part of the network. To qualify for bidding on that, companies were required to submit payments by Jan. 4.

Federal Communications Commission Chairman Kevin J. Martin said he was disappointed that Frontline will not participate in the auction but that he was optimistic that other companies will bid on those airwaves, which will be shared with public-safety agencies.

The FCC this week released a final list of 214 bidders for the auction, scheduled for Jan. 24.

The airwaves to be auctioned are now used by television broadcasters and will become available once they switch to digital signals in February 2009. The auction is for two main blocks, one designed for shared use by public-safety agencies, and another for commercial use. Winners would be able to use the airwaves for wireless voice and data services.

Among the bidders that qualified was Google, which lobbied successfully for a requirement that a third of the airwaves to be auctioned be open to any device or software applications.

Google or some other company will have to bid a minimum of $4.6 billion to ensure that the new airwaves will allow more open use of the network.

Verizon Wireless and AT&T, the two dominant U.S. cellphone-service providers, qualified to bid. MetroPCS Wireless also qualified, as did Alltel, which was recently sold to private investors.

Once the auction begins, information on how it progresses will be limited. Bids will be submitted anonymously. The winning bids will be publicized at the end of each round, but not the names of the bidders.